7 mistakes when buying a car
Auto shopping errors can be costly.
Driving a new car can be nerve wracking. For those first few weeks on the road it seems you’re always aware that with one wrong turn of the steering wheel, one scratch or one spill, the pristine sheen of your new car will be gone. But a few dings and dents are practically inevitable. It’s wiser to worry more about the blunders we make before we drive off the lot – in the process of choosing and paying for a new car -- because those faux pas can cost five figures.
Here are seven mistakes to avoid when buying a car:
1. Not shopping around: for the best price
There’s so much information about cars available on the Internet, there’s no excuse not to know the invoice price for each of the models you are considering. And don’t stop there: prices on the same model can vary from dealership to dealership in the same city, so be prepared to visit a few.
2. Not shopping around: for financing
Dealer financing might be convenient, but it could cost you. Shop around for a car loan before accepting the dealer’s interest rate. If you’re offered zero-percent financing, make sure that rate is fixed, and won’t change after a few months.
3. Buying the wrong car
You might want a two-seater sports car for your life-in-the-fast-lane fantasy, but you need a mini-van for your carpool-lane reality. If you buy a car that doesn’t fit your lifestyle, chances are you’ll be shopping for a new one soon.
4. Buying more than you can afford: negative equity
Perhaps the only thing worse than owing more on your home mortgage than your home is worth is owing more on your car loan than your car is worth. That’s because, unlike a house, a car is a depreciating asset with no chance of increasing in value in the future. Make sure you can make a down payment sizable enough to avoid getting “upside down” on your car loan.
5. Buying more than you can afford: after the sale
You’ll be paying for property taxes, car insurance and gasoline for years to come, and those costs can vary widely from model to model.
6. Taking too little for your trade in
Know how much your old car is worth before you head out new-car shopping. Negotiate your trade-in value separately from your new car’s price, so you can easily compare offers from multiple dealers.
7. Accepting extras
Even if you think you’ve almost made it to the car-buying finish line unscathed, the dealer will probably try and hit you with some add-ons. Consumer car experts generally agree that it’s a good idea to think twice about extras such as rustproofing, fabric protection and extended warranties.
To find the right auto loan for you, visit lendingtree.com, the preferred auto loan provider for AutoTrader.com.
Provided by LendingTree.
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